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- Supreme Court rules that qui tam relators may have as much as 10 years to file
- DOJ intervenes in only about one in five cases
- Whistleblowers may be awarded up to 25% of settlement amounts
- Over 12,000 whistleblower cases have been filed since 1986
The Supreme Court unanimously ruled that whistleblowers (qui tam relators), in some cases, can bring False Claims Act (FCA) lawsuits (qui tam cases) for up to 10 years after the FCA violation. In 1986, Congress amended the FCA to include an additional statute of limitations provision, Section 3731(b)(2), allowing a party to bring an FCA case up to 10 years from the time of violation, where previously the FCA only provided a 6-year statute of limitations. The ruling specifies that a whistleblower could take advantage of the longer statute of limitations provision, even in cases where the government has declined to intervene. Previously, jurisdictions were divided on whether the FCA’s longer statute of limitation period only applied when the government intervenes or initiates the case.
The vast majority of FCA cases are brought to the DOJ by whistleblowers under the statute’s qui tam provisions. Whistleblowers must provide evidence to support the complaint. The DOJ then decides whether to intervene in the qui tam-initiated case. If the DOJ decides to intervene, the government takes the lead in the case; and if not, the relator may pursue the case independently in federal court. In practice, the DOJ elects to intervene in only a small percentage of cases, about one in five filings. Further, there are few cases where the DOJ declines to intervene and realtors continue to pursue the case on their own. Successful relators are entitled to between 15% and 25% of the government’s recovery, plus attorneys’ fees and expenses. The penalty under the FCA is up to three times the amount of each false claim, plus additional penalties as high as $21,563 per claim. Last year alone there were 645 qui tam suits filed, an average of about 12 new cases a week.
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Kashish Parikh-Chopra, JD, noted that since the 1986 amendments to the qui tam provisions went into effect, whistleblowers have filed over 12,000 qui tam cases with a current average of one such case being filed almost every day of the year. Additionally, the DOJ reports that 90% of their successful FCA actions rested upon qui tam relators. Most civil fraud settlements and judgment recoveries involved health care entities. Compliance Officers should also consider that many cases that result in a settlement also involve violations of the federal Anti-Kickback Statute (AKS). It is the government’s position that all claims arising from a corrupt arrangement that violates the AKS, or in some cases the Stark Law, are considered false claims and therefore also trigger an FCA violation. Ms. Parikh-Chopra advises her clients that the best ways to manage the whistleblower risk is to ensure that individuals are guided through internal communication channels and that their complaints are promptly evaluated, investigated, and resolved. It is worth considering the following:
- Use outside experts to independently audit arrangements with physicians and evaluate compliance communication channel effectiveness;
- Ensure that an external 24/7 hotline is operated by people knowledgeable in health care compliance;
- Review/update hotline-related polices (confidentiality, anonymity, non-retaliation, duty to report, etc.);
- Ensure that the duty to report suspected wrongdoing is explained in the organization’s Code of Conduct, policies, and training;
- Have properly trained people available to conduct prompt and competent investigations of matters raised through the hotline; and
- Move quickly to use CMS and OIG self-disclosure protocols when there is credible evidence of violations; and do not wait until the DOJ gets involved.
For more information on this subject, Kashish Parikh-Chopra can be reached at firstname.lastname@example.org or via telephone at (703) 535-1413.